Trade-Ideas LLC identified

Illinois Tool Works

(

ITW

) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Illinois Tool Works as such a stock due to the following factors:

  • ITW has 11x the normal benchmarked social activity for this time of the day compared to its average of 0.68 mentions/day.
  • ITW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $229.6 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on ITW:

Illinois Tool Works Inc. manufactures and sells industrial products and equipment worldwide. It operates through seven segments: Automotive OEM; Test & Measurement and Electronics; Food Equipment; Polymers & Fluids; Welding; Construction Products; and Specialty Products. The stock currently has a dividend yield of 2.7%. ITW has a PE ratio of 16. Currently there are 7 analysts that rate Illinois Tool Works a buy, no analysts rate it a sell, and 5 rate it a hold.

TheStreet Recommends

The average volume for Illinois Tool Works has been 1.8 million shares per day over the past 30 days. Illinois Tool Works has a market cap of $29.9 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.10 and a short float of 2.4% with 2.64 days to cover. Shares are down 12.6% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Illinois Tool Works as a

buy

. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, notable return on equity, expanding profit margins and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • ILLINOIS TOOL WORKS has improved earnings per share by 8.6% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, ILLINOIS TOOL WORKS increased its bottom line by earning $4.68 versus $3.62 in the prior year. This year, the market expects an improvement in earnings ($5.11 versus $4.68).
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Machinery industry and the overall market, ILLINOIS TOOL WORKS's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • 43.59% is the gross profit margin for ILLINOIS TOOL WORKS which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.23% is above that of the industry average.
  • Net operating cash flow has significantly increased by 160.51% to $706.00 million when compared to the same quarter last year. In addition, ILLINOIS TOOL WORKS has also vastly surpassed the industry average cash flow growth rate of -18.37%.
  • Despite the weak revenue results, ITW has outperformed against the industry average of 21.7%. Since the same quarter one year prior, revenues slightly dropped by 9.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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